Oil gains over 3% on hopes Omicron-dip overdone; questions raised on market rigging

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Oil gains over 3% on hopes Omicron-dip overdone; questions raised on market rigging

On Monday, both US and UK crude oil futures’ prices gained as much as 3 per cent with UK crude briefly breaching $77 per barrel, as investors appeared to have stomached a havoc-scale pandemic-related dip in previous session and decided to cling on to a ‘wait and see’ approach.

Apart from that, soothing remarks from S. African doctors who were treating Omicron cases alongside comments from Kremlin and Riyadh had helped calm investors’ angsts following more than a 12.0 per cent plunge in both benchmarks last week.

In point of fact, earlier in the day, Chair of S. African Medical Association, Angelique Coetzee, a General Physician, was quoted saying that she had been treating Omicron cases since November 15 and most patients were aged below 40 and unvaccinated, while patients having infected with Omicron variant have had ‘very mild symptoms’ and did not require hospital admissions, which eventually raised prospects that the newly identified variant would unlikely to be as serious as delta that often require hospitalization in elderly and unvaccinated patients.

Besides, the S. African doctors’ quote also had raised questions on whether anonymous blue-whales had acted purposefully to engineer a global-scale sell-off in commodity markets amid OPEC+ nations’ reluctance to raise outputs to rebalance the crude oil market, suggested analysts.

The White House said in a statement on Monday that it would not release oil from strategic reserves at a lower price due to Friday’s Omicron-induced dip. Aside from that, Monday’s gain in crude oil prices were galvanized by comments from Riyadh and Kremlin, while both OPEC+ partners were quoted saying that they were not worried about Omicron and there was no need for hasty decisions for global crude oil outputs, eventually adding further bullish breeze on crude oil futures’ prices.

Oil gains nearly $3/barrel after giving up $10/barrel in past two weeks

Citing statistics, in the day’s commodity market wind-down, UK crude futures’ prices closed out the session about 3 per cent higher to $75.02 a barrel, while US West Texas Intermediate (WTI) crude oil futures’ prices rounded off just a notch shy of $70 a barrel after rising as much as 4.3 per cent earlier in the session.

Meanwhile, referring to Friday’s fear factor, a Swiss Bank Julius Baer analyst Norbert Ruecker said, “The fear factor had its grip on financial markets on Friday. Fundamentally, the announced and enacted international air travel constraints cannot explain such a sharp slump.